Mr. Wallace to Mr. Frelinghuysen.
Sir: If you will be good enough to refer to my dispatch to the Department, No. 98, June 9, 1882, it will be seen that a protest was called for from this legation by a projected regulation of the storage of petroleum in Smyrna. In the same dispatch, as will also be observed, a reference is made to a like scheme for operation in Constantinople. My protest of that date was accordingly drawn to cover the imposition proposed for both cities. A note from the minister of foreign affairs received January 10, 1883, informed me that, the necessary preparations having been made, all ships arriving at Constantinople with petroleum must land their cargoes in the depots built by certain concessionaries of the Government at a place designated.
A year or two ago this regulation would not have been of much importance except to consumers of petroleum, for it was then an American commodity exclusively. The development of the wells of Russia, however, has created a competition which is beginning to make itself felt in this market. The article is vastly inferior; nevertheless, the demand for it grows apace, making the protecting of the interests of dealers in our product a matter of greater care.
The Russians bring their stock here in small vessels via the Black Sea; and, there being a rule which permits the shipper to sell from his ships in limited quantities, their usage is not to land their cargoes. The advantage is obvious. The steamers which bring American petroleum must discharge in bulk, and the dealers pay a storage charge to the owners of the depots. There are no other depots, and a man cannot have a storehouse of his own. Into this particular lodgment he must drop his goods, nolens volens. The Government, of course, gets a dividend from the charges. Its share in Smyrna was to have been 1 per cent.; what it is to be here has not yet been divulged.
Prior to this new regulation petroleum from America was landed at a depot at or near the locality now designated for the purpose. The charge was light, and, admitting the necessity for storage of an article so dangerous outside the city limits, dealers were satisfied. That you may see how the present action of the Government is received by merchants generally, I inclose a communication to me upon the subject. The subscribers, it is to be remarked, are of several nationalities, and they refer in their paper to an expression had in the matter from the chamber of commerce of Constantinople. They all agree that the effect of the order of the Sublime Porte, if it is carried out, will be to double the tax or charge upon the article fixed by our treaty.
Under these circumstances, and with a design to protect our interests as energetically as possible, I sent the Porte a note, of which a copy is herewith transmitted. I followed the communication in person, and had a long interview with his highness the minister of foreign affairs. Indulge a hope that a good effect will be produced. There will at least be a speedy answer.
Trusting my action will meet approval, I will make haste to inform you of the imperial decision when it shall have arrived.